Cook: Apple TV sales up 35 percent, won't remain dormant, hardware not a priority

Discussion in 'Apple TV and Home Theater' started by jaw04005, Feb 24, 2010.

  1. jaw04005 macrumors 601

    jaw04005

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    #1
    Since no news outlets have managed to describe exactly what Tim Cook said about the Apple TV in detail (which is odd considering the entire thing was webcast), I thought I would start a thread to aggregate it all.

    From Arstechnica:

    Other comments reiterated things we have heard before, such as Apple TV remaining a hobby. The device doesn't sell nearly the kind of volume that Apple usually wants to see, but it did see a sales increase of 35 percent in the most recent quarter. "We're continuing to invest in it because our gut tells us there's something there," Cook said, after sharing that he is an avid Apple TV user. :D

    http://arstechnica.com/apple/news/2010/02/apple-is-a-mobile-devices-company-in-post-iphone-world.ars

    From AppleInsider:

    Cook said he believes the Apple TV is an outstanding product, but there just isn't a large enough market to make the hardware worth a great deal of concentration from his company. The product is a "hobby," he said, because it doesn't compare to the phone, computer and MP3 player markets in terms of sales.

    "Apple TV is still a hobby," he said. "We've been very clear about that."

    But he also suggested the company's set-top-box device wouldn't necessarily lay dormant. It may just take time for the potential market to grow.

    "Because our gut says something's there, we're continuing to invest in this," he said. "But today, it's still just a hobby."

    http://www.appleinsider.com/article...im_cook_talks_apple_tv_a4_processor_more.html

    From Macrumors:

    Q: Where do you see things going with the Apple TV?
    A: It's still a hobby, but our gut tells us there's something there. The go-to-market model is difficult, and we have no interest in being in the TV market. But we have continued to invest in the Apple TV and will keep doing so.

    http://www.macrumors.com/2010/02/23/apple-coo-tim-cook-speaks-at-goldman-sachs-conference/

    Apple has posted a QuickTime audio stream of the event:

    http://www.apple.com/quicktime/qtv/goldmansachs10/
     
  2. gibbz macrumors 68030

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    #2
    I think Apple still doesn't quite know what it wants the Apple TV to be. I have one and love it, but I think there are endless possibilities to make it so much better.
     
  3. richman555 macrumors 6502

    richman555

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    #3
    I love my Apple TV. I've had it for half a year and I've built a good collection along with an external drive to store my iTunes data. The only thing that holds it back is disk space (on your pc or mac) as you need a large disk drive to store a good collection of movies and tv shows. The average joe will not buy an external hard drive. That being said we are a few years off, but digital movies are so much better than buying discs.

    As for people complaining that there is no 1080p movies.... I hardly miss it at all. Obviously it will take much longer to download and take up alot more disk space. Its just not practical. 720p is perfectly fine for now. I also buy standard shows occasionally just because they are cheaper. I also have a wireless Samsung blue ray player... and it collects dust as I only own 2 blue ray disks and I prefer the convenience of buying the movies from home.
     
  4. fpnc macrumors 68000

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    #4
    Up 35% again? It wasn't much more than a year ago that Apple said that sales of the Apple TV were up three-fold from the previous year. I wonder if this new report is year-over-year or just from the previous quarter (the latter would make sense as it would have been during the Christmas season). In any case, various analysis have estimated that Apple has sold over six million Apple TVs which I think would make it one of the most successful dedicated media extenders on the market.

    Based upon some of the rumored sales numbers I've seen for the Roku Netflix player (see link below) I'd say that Apple may have sold more Apple TVs than the Roku player, the Western Digital TV (Live), Popcorn Hour and all of the other lesser known media players combined.

    Roku has sold 500,000 units as of Jan 2010:

    http://www.multichannel.com/article/446244-Roku_Has_Sold_500_000_Internet_Set_Tops_Eyes_IPO.php

    I wonder if Apple is doing a little "rope-a-dope" with the Apple TV. It may be a modest success that they just don't want to talk about (for fear of alienating the content providers and alerting others that there is money to be made even in this still emerging market). Frankly, I don't expect internet-streamed media to begin to reach its full potential for another two or three years. The broadband infrastructure in the U.S. isn't yet capable of handling HD streaming in a big way and the media distribution channels in other parts of the world may as yet be underdeveloped even in comparison to the restrictive systems we have in the U.S. Both of the latter are probably the reason why the Apple TV has to remain a "hobby" for the time being.
     
  5. BlizzardBomb macrumors 68030

    BlizzardBomb

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    #5
    Would be nice if they fixed the UK price. Since when does £223 = $229?
     
  6. jaw04005 thread starter macrumors 601

    jaw04005

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    #6
    Cook said, "Apple TV did grow in the quarter we just finished 35 percent on a unit basis year over year.”

    So I’m assuming he was referring to Q4 ’09 compared to Q4 ’08 since they don’t compare products quarter to quarter for the reason you said.

    Last year, around this time he also said, "there was a tremendous tickup year over year [for Apple TV]. In fact unit sales were up over 3 times vs the year-ago quarter.”

    I’m assuming since that conference call happened in January ’09, he was referring to Q4 ’08 compared to Q4 ’07.

    Sort of miraculous isn’t it? Even with all the negative press about Apple TV (and all the love for stuff like the Roku), it’s probably the most successful set-top media box to date.

    I think they keep calling it a “hobby” so they can play around with different features and UIs. No other Apple product has ever had its UI changed dramatically twice or had fairly rich features (like AC3 surround sound audio, iPod/iPhone touch remote app with gestures, AirSpeakers, YouTube, Internet Radio, iTunes Store, etc) added to it for free like the Apple TV.

    If you restore your Apple TV back to firmware 1.0, use it and then upgrade it back to 3.x — it’s like you’re using an entirely different product.
     
  7. godslabrat macrumors 6502

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    #7
    Maybe Apple would see the kind of volume they want if they made the hardware better? Radical thought, I know...:p
     
  8. dynaflash macrumors 68020

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    #8
    Well said and very true imo. Right now its a sandbox they can play in with little risk.
     
  9. spice weasel macrumors 65816

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    #9
    I think the ATV is still a hobbyists gadget because Apple has allowed it to be. With some clear direction and marketing from Apple I could see it being a very popular device. As it stands, how many people are really going to buy a device that hasn't been updated in years and might never be? Yes, 35% is impressive as a relative number, but how many actual users are we talking about here.

    What Apple is so great at is creating improved versions of devices that already exist and then creating a huge demand for them, to the point where people just have to have one. Apple doesn't wait for the market to mature, it creates those markets. They could do the same with the Apple TV if they really wanted to.
     
  10. Rich1963 macrumors 6502

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    #10
    Two things-

    -Anyone who thinks Apple is going to drop the AppleTV is smoking crack. Apple sells media. Love it or hate it, LARGE amounts of media are consumed while in the horizontal position in front of the TV. While Apple probably wants to avoid a punch-for-punch slugfest with Comcast, Netflix, DirecTV, DishNetworks, and Time-Warner all at once (not to mention the studios), they aren't going to leave the living room anytime soon.

    -People seem to forget what the AppleTV is and is not. What it IS is an iPod for your television and home entertainment system. It's priced reasonably to simply be a media extender for your living room. Nothing more; nothing less. We may wish it to be more. A DVR. Play 1080p. Surf the web. Stream Netflix. None of it is going to happen. It serves one purpose and that purpose is to display content on your television and through your home audio system you have purchased from iTunes. It does this pretty well.

    Could it use a hardware upgrade to make it smoother? Sure could. Will it be upgraded? Sooner or later. Has to be. Intel will only keep making the stone-age architecture for so long. But it will always mirror the capabilities of the iTunes store. Until you see Blu-ray quality 1080p movies there, you won't see the AppleTV doing it.

    My personal theory is that Apple doesn't really fancy the living room, but knows the reality is that people want their content moved there, and if they don't provide a way, somebody else will.

    Who knows what the future holds...
     
  11. mchalebk macrumors 6502a

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    #11
    On the whole, I've been very happy with my AppleTV. I'm in no hurry to upgrade. However, one of the reasons I got the AppleTV was so that I didn't have to burn DVDs to watch home movies. It is a real shame that the AppleTV is limited to 24 fps at 720p when most HD camcorders can record at higher frame rates and resolutions.

    In my opinion, the lack of 1080p movies isn't the big drawback, but the fact that the AppleTV cannot do a proper job of displaying HD home movies. For rental purposes, I am more than happy with the 720p offerings from the iTunes store. However, I don't want to have to downgrade my home recordings due to the limited capability of the AppleTV.
     
  12. dynaflash macrumors 68020

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    #12
    Well said ... I might add this: Before the atv was around I can remember doing the same thing albeit in a cave man ( sorry cave ) fashion with my 5G iPod and a radio shack cable and thinking it was awesome ( which it really was at the time ). Then along comes the atv. $230 us vs. $400 ( at the time ) for the ipod.

    No Brainer. Atv all the way. Right now like it or not the atv is an iPod for your living room. No more no less. It extends the iTunes experience to your living room tv and does it quite well. Third party software ( which will remain nameless) strives to extend the atv's content delivery further while remaining within its ecosystem.

    Having said that I am actually quite surprised it has seen the software updates it has free of charge. Not bad really. Plus the iTunes stores investment in HD rentals, etc. (few as they may be) tells me it is not dead by any means. It simply is not what some would like it to be.

    I actually can see apples point in waiting to see what is going to gain traction in the living room experience. It is imo by no means a given that blu ray will dominate, nor how cable will shake out etc. While I too long for a harware update, etc. I can see apple's postion on it.

    Been around the atv and this forum long enough to know that the demise of the atv is not a foregone conclusion, regardless of rumors. Anyone that has bet on it in the past ( and we have all seen many do so ) would have lost a lot of money had they bet on their predictions.

    Just my .02 .
     
  13. Rich1963 macrumors 6502

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    #13
    Just one more thing....

    This has very little to nothing to do with this discussion (directly), but what I do find funny is that the AppleTV is the one product that doesn't fit into the Apple Corporation 'plan for world media domination'.

    This plan has always been quite simple. Create easy to use graphical software that empowers you to explore a device's full potential, and then wed that to industrial, modernistic hardware that has a definite 'chic' factor. Apple then charges 2-3 times what any other retailer would for similar hardware, using that seamlessly integrated software to keep you hooked. Oh, and refresh it every 12-18 months by adding some logical upgrade that everyone thought should have been there on the last redesign, and also add something no one else saw coming.

    The AppleTV has above average software and interface design, but I would not begin to place it on the same pedestal as an iphone or my mac running OSX. The hardware look and design is outdated, and I would hardly call it expensive when compared to the capabilities and prices of what others offer that stacks up similarly.

    It's why on this subject I take both Tim Cook's and Steve Job's word at what they say if you boil it down-

    -We don't know exactly where this product is going, so we're going to give you a working product to act as a bookmark in this sector of the industry until we finally implement a killer plan, which we may or may not be trying to implement at this time.

    Or, more plainly put, it's a hobby.

    It's why this company is so much fun to watch, and speculating about Microsoft or Sony causes me nod off at my desk.
     
  14. taeclee99 macrumors 6502a

    taeclee99

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    #14
    I've given up on the apple tv. Decided to get either a popbox or boxee box instead.
     
  15. fpnc macrumors 68000

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    #15
    Something over six million units if you believe the estimates that have been given by several analysts. It's certainly one of the most successful dedicated, set-top media players on the market.
     
  16. Rich1963 macrumors 6502

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    #16
    Frankly, the whole market for set-top boxes is still what most major corporations would call a hobby. This is a market that is dependent on other factors besides hardware/software integration. Unlike the ipod, media content is very reliant on studios and networks. The ipods were easy to move because, despite an easy way to purchase some music you might want, 97% of what was placed on an ipod was already owned by the user, simply ripped with an easy to use application.

    Despite what us hobbyists do with Handbrake, the market for the majority of users is completely opposite this time around. Content is almost completely reliant on outside vendors. DRM is a must. And the worst part, NONE of these devices is really worth ownership without a broadband connection and a decent network infrastructure running within your household. Not quite the same playing field as a pocket-sized media player syncing via USB, is it?

    I don't believe for a second any of the players out there knows or possesses a comprehensive strategy for making any set-top box a dominant player at the moment. But one thing they all know, as I referenced in an earlier post, is that they need to get a placeholder in this market segment so when the tea leaves become more readable, they are ready to act. And every company has dreams of becoming the next Apple in the home media segment. And, yes folks, that means you'll need to out-Apple Apple.

    Look at what Apple moves in iphones and ipods, and you definitely see why Tim Cook consistently refers to it as a hobby. Those numbers (6million units) make it a hobby when compared to Apple's other endeavors.
     
  17. HobeSoundDarryl macrumors 603

    HobeSoundDarryl

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    #17
    This chicken and egg argument keeps coming up in thread after thread related to :apple:TV, pretty much ALWAYS taking this same side- that the content must come BEFORE the :apple:TV. While that thinking makes it look like Apple is simply beholden to the Studios, it's backwards thinking.

    The Studios have NO REASON WHATSOEVER to even test 1080p content for :apple:TV because it's impossible for :apple:TVs to play 1080p content. So even if every studio wanted to push 1080p content to :apple:TV owners now, it's impossible for them to even see if that could be a profitable option.

    Apple has total control of only the hardware side of the equation. As such, Apple must LEAD in this. They must take the step of trying to entrench 1080p (upgraded) hardware so that the Studios can be increasingly tempted to test 1080p content.

    They must lead just like they do with every other bit of hardware they make. For example, Apple built tethering and MMS into an iPhone even though AT&T couldn't handle it. Apple keeps updating computers with features that no software can capitalize on in advance of the launch of that hardware. Etc.

    Just as the iPhone didn't wait for AT&T to get all of its supporting features in place before it was advanced... just as Macs didn't wait for all software creators to get their software updated to capitalize on multicore, etc before rolling out those new Macs... so goes the obvious option with a next-gen :apple:TV.

    If a next-gen :apple:TV must wait for next-gen :apple:TV (1080p) content to first be introduced in the store, we NEVER get a next-gen :apple:TV.

    If a next-gen :apple:TV is launched by Apple and entrenches, every additional unit sale becomes one more temptation for at least one studio to test the profit potential of 1080p content via iTunes to :apple:TV.

    In the meantime, those of us with 1080p camcorders who would like to read those movies at full resolution into iMovie (Apple already has this option available to us) on Macs capable of the heavy lifting (Apple already has this option available to us) to then render them as 1080p files that can be inserted and played in iTunes (Apple has already made iTunes capable of handling 1080p renders) would tremendously enjoy the last link in the chain being updated to pass those files on to our 1080p HDTVs.

    My money anxiously awaits them doing exactly what they do in just about everything else they make.
     
  18. jaw04005 thread starter macrumors 601

    jaw04005

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    #18
    That’s a great theory except it hasn’t worked with 720p. So, why would you think it would work with 1080p?

    You’re talking about at least doubling the current size of an iTunes HD movie from 4-5GB to 8-10GB.

    Personally, I think it adds just another level of complication to iTunes. We already have two different files per HD download. What’s next? We have to download and store three different versions, a SD version for iPhone/iPod touch, a 720p HD version for iPad/Apple TV Gen. 1 and a 1080p version for Apple TV Gen. 2?

    You have to consider the entire iTunes and device ecosystem, unless you plan on only offering 1080p content via the rental model on the Apple TV similar to the “DVD quality” rentals available now.
     
  19. Rich1963 macrumors 6502

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    #19
    I believe you're misunderstanding the argument in regards to 1080p content and the AppleTV. Look at Apple's entire ecosystem of products, and other than the mac, what products can handle 1080p? None.

    I would like nothing more than to have a 1080p capable AppleTV for blurry rips and my home movies, but if you like at every move Apple has made, NONE of it has included 1080p thoughts whatsoever.

    It isn't that it isn't a want, but if you look at Apple's moves (including the iPad's capabilities), they don't include any thoughts of 1080p. It has nothing to do with the networks holding them back. In my opinion, Apple simply thinks that between the smaller screen sizes of the majority of their products, 1080p would be a horrible waste of space on almost all of their products with little to no benefit in return.
     
  20. HobeSoundDarryl macrumors 603

    HobeSoundDarryl

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    #20
    I'm not sure I understand the first sentence. Per my "great theory", Studios are delivering 720p content in iTunes for :apple:TV. They could have just stuck with the old max standard (not quite DVD quality), but one or more decided to test 720p once there was hardware capable of playing it, and it apparently worked (given how many 720p movies are regularly available for for :apple:TV).

    As to the file size issue, so what. If 8-10Gb seems big to you now, it won't in a few more years, just as 4-5Gb files might have seemed "too big" a few years ago. Storage is dirt cheap and always getting cheaper. Why buy 720p now, and then buy it again in 1080p later? Why not max it now and buy reasonably futureproof media? 1080p will be THE max standard for a very long time.

    While Apple keeps stalling around this "hobby" argument, BD players are selling at a far greater pace. Most of those players have considerably less functionality than our :apple:TVs, and they come with the pain of having to mess around with physical media to watch anything. Yet they still outsell :apple:TVs by a wide margin. Why? Because they have ONE key benefit that makes them the BEST match for all those new 1080p HDTVs being purchased- a benefit that Apple could easily add to a next-gen :apple:TV to make it a very appealing alternative.

    And again, sell enough 1080p :apple:TVs, and some Studio will decide to test the profitability of 1080p movie or TV shows on :apple:TV. If they find it profitable, more will quickly follow. As is often argued in other threads, it should be considerably cheaper to sell a movie or show via iTunes than to give Walmart or Best Buy their cut to retail a physical disc. But it's this later medium that winning, as demonstrated by numbers of BD boxes purchased vs. number of :apple:TVs.
     
  21. HobeSoundDarryl macrumors 603

    HobeSoundDarryl

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    #21
    Again, that's a very pro-Apple stance: the bulk of our iTunes-connected hardware doesn't currently favor 1080p (even though iTunes itself does), so why offer 1080p? Again, Apple should lead, and a 1080p file option can be just like a 720p file option in the store, when (older) iPods could not handle it. Already, even the current :apple:TV offers us the option of SD or (720p) HD version of many programs. So why not auto-detect a 1080p :apple:TV and let it's HD option point at the 1080p version of the file? Easy.

    As far as the "little to no benefit", that's purely eye of the beholder. And in general, it's a stance that could be offered up as an excuse for every Apple shortcoming. Apple sees little benefit in return, so why build in a better graphics card for those Macs. Apple sees little benefit in return, so why include an iSight camera in that iPad. Apple sees little benefit in return, so why include...

    As a BUYER of Apple stuff though, the ONE benefit I would MOST like is 1080p hardware in a next-gen model. I've now got 3 years of precious home movies that never look their best unless I deal with hooking the camera directly to the HDTV, or hooking a Mac directly to the HDTV, so that the 1080p video can be seen there.

    However throw out that stance (you know, give BUYERS what they want) and Apple could still stick with the "little to no benefit" stance by simply passing it on to the end user. Download the SD of 720p version that fits this iPad or iPhone or Touch screen AND/OR download the 1080p version which is overkill for this stuff but will play beautifully on your HDTV when run through our next 1080p AppleTV.

    Even if YOU feel 720p "as is" is plenty, that's fine too. If Apple would just let those who feel the same have the 720p option, then YOU can save all that hard drive space for the files you find "good enough," while letting those of us who would prefer 1080p content on our 1080p HDTVs get what we seek too. That would be a way for EVERYONE to win.
     
  22. jaw04005 thread starter macrumors 601

    jaw04005

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    #22
    Most studios didn’t start renting and selling content on the Apple TV in HD in masses until late last year (in the United States) even though 720p has been available since early 2008.

    So, my point was offering 720p as an option back in 2008 didn’t matter. That’s not what the studios were waiting on. So why would you think it would matter now?

    Even now, studios like Fox and Warner Bros are refusing to offer their content for purchase (and in some cases rental) on the Apple TV in HD because they want to protect other traditional distribution channels (probably Blu-ray, DVD and video-on-demand).

    Apple needs to focus on getting all the studios to offer both SD and 720p HD rentals and purchases on their day of release before they worry about adding 1080p as an iTunes Store option.

    Do I want 1080p? Sure, but I know what 1080p is, the difference between it and 720p and how to handle the problems associated with it including the additional storage required for storing and backup.

    Do I believe I’m the typical Apple TV user? Nope and I understand why Apple has so far not offered it as an option.

    In the grand scheme of things, it doesn’t matter to the average iTunes Store customer. Apple doesn’t cater to the geek crowd.

    I do believe 1080p will come eventually and it’ll probably come first in the form of streaming to the Apple TV (Generation 2) for rentals only, just like the XBOX 360.
     
  23. HobeSoundDarryl macrumors 603

    HobeSoundDarryl

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    #23
    Then let me clarify my theory once more:

    Just as there were NO 1080p BD discs (content) available before there were BD (hardware) players in homes, until there is a reasonable number of 1080p-capable :apple:TVs in homes, there is NO POSSIBILITY of the viability of 1080p content being even tested for :apple:TV... even if the Studios wanted to see what it could do. As a result, waiting for 1080p content to first hit the iTunes Store creates an almost endless delay in even bothering to build a next-gen :apple:TV.

    What would make sense is for Apple to deal with what it controls- hardware development- and thus lead the way with a 1080p :apple:TV. Every additional unit that entrenches in a home is another potential buyer of 1080p content for sale in the iTunes Store. There comes a point when there is enough of a potential market to motivate some Studio to test 1080p. If they find it profitable, more content will follow it into the iTunes Store.

    If we look at the 720p scenario, it was just the same. Apple led by building 720p into the hardware before iTunes had 720p content. Podcasts began to go 720p. Then, when enough units were in place to make it potentially profitable, Studios struck deals with Apple to test some 720p content in the Store. The biggest key to that happening is Apple leading with the hardware so that that test could eventually be executed by the Studios. Had :apple:TV been constrained to iPod 5 quality video at max, there would have been no reason for Studios to test 720p HD content for :apple:TV "as is" either, and we would all be enjoying(?) less-than-DVD quality on our :apple:TVs, iPhones, Touch, and maybe this iPad.

    And unfortunately, I can imagine some of the very same supporting arguments being made: "file sizes of 720p are 2-3 times larger than current iTunes video", etc.
     
  24. jaw04005 thread starter macrumors 601

    jaw04005

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    #24
    I understand your point better now. However, I think if studios wanted 1080p to test they would tell Apple they want it added as option, and it would be added (even if it was just added to iTunes).

    Unfortunately, I don’t think it’s a big concern for them (the studios or Apple).

    The iTunes Store issues aside (pricing issues, multiple file downloads, size considerations, etc), a 1080p playback-capable Apple TV with a SATA notebook drive, better processor and more RAM would be a fantastic device and a doable evolutionary upgrade for the Apple TV.

    My Apple TV feels almost maxed out right now just by using things like iTunes LP or Extras, controlling it using the touch feature of the iPhone remote app or trying to play an Internet Radio station while simultaneously browsing the main menu.
     
  25. QCassidy352 macrumors G3

    QCassidy352

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    #25
    it's a nice idea, and I could see getting one some day, but they really need to get past this "hobby" crap and put some work in to it.
     

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